\(> FUEL I.1K1 AN OLD FOSSIL Mil 



831 



vour fixed opposition to this bill. My studv of the situation suggests that the state- 

 ment in question was taken out ot context and docs not necessarily imply any such 



position. 



Although a letter was not received immediately from Carter, his 

 campaign staff confirmed the fact that it was his policy not to take a 

 position on legislation pending before the Congress. Former Governor 

 Endicott Peabody of Massachusetts, a lobbyist for the synthetic fuels 

 loan guarantees, reported that he had met with Carter on August 29, 

 and discussed the subject at length with him. Peabody, according to a 

 formal statement by Teague, indicated that "Carter told him he has no 

 position on this legislation and has not authorized anyone to speak for 

 him on it." 



Even though it is doubtful if this game of one-upmanship really 

 influenced any votes, Teague persisted until he persuaded Carter to send 

 him a personal letter, which he did on September 4. The letter stated in 

 part: 



My comments were not directed specifically at H.R. 12112. My general position 

 on synthetic fuels should not be taken as specific opposition to your bill. 



Since the full text of the Carter letter of September 4 was never released, 

 it did raise a question of what he had said in the remainder of the letter. 

 But not many people other than the main leaders in the fight paid much 

 attention to it. 



GAO OPPOSES LOAN GUARANTEES 



Teague conferred frequently with the White House to encourage 

 greater support from President Ford. Meanwhile, Hechler had asked 

 the GAO to provide an analysis of loan guarantees for synthetic fuels. 

 On August 24, the GAO released a negative report which dealt a 

 serious blow to the loan guarantee supporters. The report stated: 



In the present circumstances, GAO believes government financial assistance for 

 commercial development of synthetic fuels should not be provided at this time. Full 

 priority should be directed to development of improved synthetic fuels technologies; 

 however, it appears possible to gain adequate information of an environmental and 

 regulatory nature from smaller plants under government control. When commercial- 

 ization of the technology becomes a prime objective, consideration also should be 

 given to approaches other than loan guarantees for gaining private industry interest. 



The GAO Report supported the conclusions of the opponents, 

 stating "Conservation measures are by far the most cost effective way 

 to 'produce' energy and, therefore, should have the top priority for 

 Government financial assistance." About the same time, the Wall 

 Street Journal came out with another critical editorial denouncing the 

 use of Federal subsidies through loan guarantees. The one-two punch 



